Background: Over the last decade, the Veterans' Health Administration (VHA) has shifted from providing long-term and post-acute care in facilities owned and operated by states or the VHA, toward contracted care in privately-owned facilities, known as community nursing homes (CNHs). From fiscal years 2000 to 2015, expenditures for CNH care in the VHA expanded from $227 million to $861 million?nearly a fourfold increase. Meanwhile, the Office of Inspector General and General Accountability Office have raised concerns that the VHA contracts with low-quality providers. Through a Quality Enhancement Research Initiative (QUERI)-funded CNH Dashboard, Veteran Affairs Medical Centers (VAMCs) now have ready access to real-time information that displays data on the quality ratings of facilities caring for their Veterans relative to other, non-contracted facilities in the same local market and nationally. However, those data have not been analyzed to reveal trends or patterns across VAMCs that could inform VHA's purchasing policy and operations. Furthermore, the publicly-reported quality star ratings from the Centers for Medicare and Medicaid Services (CMS) have not been validated for their relevance to important Veterans' outcomes. The objective of the proposed research is to characterize variation in CNH quality as it relates to VAMC characteristics, Veteran outcomes, and contracting practices. Our central hypothesis is that a significant portion of VAMCs have opportunities to improve practices related to the purchase of high-quality care for Veterans that will lead to improved outcomes by optimizing identifiable contracting policies and practices. The significance that motivates the proposed project is that identifying variation in quality, quantifying potential gains, and understanding the policies associated with success within an integrated health care system will also contribute to our general understanding of the use of quality information in purchasing policies and practices, an HSR&D priority area of long-term care which is of broad concern to health services research in this era of value based purchasing. The Specific Aims of this proposal are to: Aim 1. Characterize utilization, cost, and quality of care that Veterans receive from VHA-contracted compared to non-contracted community nursing homes (CNHs) available in the same market area. Aim 2. Determine whether utilization of highly-rated CNHs improves outcomes for Veterans. Aim 3. Identify incentive characteristics and contextual factors that contribute to purchase of high-quality CNH care by VAMCs. Methods: Aim 1 will use descriptive analysis to compare Veterans' utilization of nursing home care, including length of stay, concentration of Veteran population within individual nursing homes, and allocation of care to CNH compared to other VHA long-term care and post-acute settings in each study year 2013-2017. Risk- adjusted total direct CNH payments per Veteran will be calculated and the relationship between price and quality rating will be modeled. For Aim 2 we will estimate the effect of increases in quality ratings on Veterans' outcomes. We will test the hypothesis that increasing the availability of highly-rated facilities among Veterans' CNH options results in fewer hospitalizations and an increased likelihood of successful discharge to the community. Using highly-innovative analytic technique, potential cost offsets available from reduced hospitalization in highly-rated nursing homes will be quantified. Aim 3 will use the analyses in Aim 1 to identify a sample of VAMCs with variation in relative quality. Two in-person site visits and subsequent semi-structured telephone interviews with key VHA and community stakeholders will be conducted and analyzed using a general inductive qualitative approach to identify how incentive characteristics and contextual factors support or thwart purchase of care from high quality CNHs. Results will be used to create a web-based toolkit to inform program revisions and VHA purchased care policy in general to purchase of high-quality CNH Veteran care.